Golden Entertainment (NASDAQ: GDEN) and Caesars Entertainment Corporation (NASDAQ:CZR) are both small-cap consumer discretionary companies, but which is the superior business? We will contrast the two companies based on the strength of their dividends, institutional ownership, valuation, profitability, analyst recommendations, earnings and risk.

Analyst Ratings

This is a summary of recent ratings and recommmendations for Golden Entertainment and Caesars Entertainment Corporation, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Golden Entertainment 0 1 0 0 2.00
Caesars Entertainment Corporation 0 0 5 0 3.00

Caesars Entertainment Corporation has a consensus target price of $14.90, suggesting a potential upside of 29.00%. Given Caesars Entertainment Corporation’s stronger consensus rating and higher probable upside, analysts plainly believe Caesars Entertainment Corporation is more favorable than Golden Entertainment.

Institutional and Insider Ownership

27.5% of Golden Entertainment shares are owned by institutional investors. Comparatively, 76.7% of Caesars Entertainment Corporation shares are owned by institutional investors. 52.0% of Golden Entertainment shares are owned by insiders. Comparatively, 4.6% of Caesars Entertainment Corporation shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Risk & Volatility

Golden Entertainment has a beta of 0.05, meaning that its stock price is 95% less volatile than the S&P 500. Comparatively, Caesars Entertainment Corporation has a beta of 0.38, meaning that its stock price is 62% less volatile than the S&P 500.

Profitability

This table compares Golden Entertainment and Caesars Entertainment Corporation’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Golden Entertainment 4.29% 6.26% 3.17%
Caesars Entertainment Corporation -81.33% N/A -33.98%

Valuation and Earnings

This table compares Golden Entertainment and Caesars Entertainment Corporation’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Golden Entertainment $426.75 million 1.21 $44.77 million $0.80 28.84
Caesars Entertainment Corporation $3.90 billion 0.44 $795.00 million ($21.45) -0.54

Caesars Entertainment Corporation has higher revenue and earnings than Golden Entertainment. Caesars Entertainment Corporation is trading at a lower price-to-earnings ratio than Golden Entertainment, indicating that it is currently the more affordable of the two stocks.

Summary

Caesars Entertainment Corporation beats Golden Entertainment on 7 of the 13 factors compared between the two stocks.

Golden Entertainment Company Profile

Golden Entertainment, Inc. is a group of gaming companies. The Company focuses on distributed gaming, including tavern gaming, and casino and resort operations. It operates through two segments: Distributed Gaming and Casinos. Its Distributed Gaming segment involves the installation, maintenance and operation of gaming and amusement devices in certain strategic, high-traffic, non-casino locations (such as grocery stores, convenience stores, restaurants, bars, taverns, saloons and liquor stores) in Nevada and Montana, and the operation of traditional, branded taverns targeting local patrons, primarily in the greater Las Vegas, Nevada metropolitan area. As of December 31, 2016, its distributed gaming operations consisted of approximately 10,400 gaming devices in approximately 960 locations. Its Casinos segment consists of the Rocky Gap Casino Resort in Flintstone, Maryland and three casinos in Pahrump, Nevada: Pahrump Nugget Hotel Casino, Gold Town Casino and Lakeside Casino & RV Park.

Caesars Entertainment Corporation Company Profile

Caesars Entertainment Corporation is a holding company. The Company provides casino-entertainment and hospitality services. The Company’s segments include Caesars Entertainment Resort Properties, LLC (CERP), Caesars Growth Partners, LLC (CGP) and Other. The Company’s facilities include gaming offerings, food and beverage outlets, hotel and convention space, and non-gaming entertainment options. As of July 14, 2017, the Company through its subsidiaries, operates 47 casinos in 13 states and in five countries. As of December 31, 2017, the Company has over one million square feet of gaming space and approximately 24,000 hotel rooms. As of December 31, 2016, CERP owned six casinos in the United States and The LINQ promenade along with leasing Octavius Tower at Caesars Palace Las Vegas (Octavius Tower) to Caesars Entertainment Operating Company (CEOC) and gaming space at The LINQ promenade to CGP. As of December 31, 2016, CGP owned six casinos in the United States.

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